Food commodities prices are expected to rise also in 2022. Here’s why

Data from Unione Italiana Food illustrate the trends, influenced by weather and pandemic, of 30 agro-industrial raw materials

Production costs in the food industry are making commodities prices rise above averages, and in some cases close to all-time highs. Mario Piccialuti, Director General of the Italian association of food producers Unione Italiana Food, points out “The weather problems, combined with the post-Covid demand recovery, and the negative effects of the pandemic on logistics largely explain what is happening in the markets. Commodities prices levels are motivated by fundamentals, with commodities stocks severely eroded by supply-demand imbalances, on top of which are spill-over effects and speculation that emphasize volatility”.

Many markets around the world have already discounted the most sustained increases, “but in some cases, we expect further price increases for food commodities and products. The return to pre-pandemic price levels will take time for stocks to rebuild. It will be of utmost importance to monitor the markets and exploit, where possible, the hedging instruments,” says Mauro Bruni, president of research firm Areté.

flour-Pizza Day-commodities


  • Cereals: markets in serious difficulty due to the recovery of Asian demand, in addition to adverse weather phenomena in North America. Corn and soft wheat prices at the highest level in the last 10/15 years.
  • Durum Wheat: the drought in North America led to a drop in production of more than -40% compared to the previous campaign in the USA and Canada, which are usually the world most important area of production and exports of durum wheat. This has resulted in price increases on the Italian market of almost +90% from May to October. These are all-time highs that haven’t been seen since 2008.
  • Eggs, milk, and dairy: increases in cereals and seeds prices have led to higher feed prices which, in turn, put pressure on the egg and milk sectors. Egg prices have increased by +26% since mid-July, also due to new outbreaks of bird flu in the EU. The price of spot milk in Italy has increased by +60% from May to October 2021, also due to delays in deliveries, causing tension on butter, milk powder, and cheese prices.
  • Dried fruits: recovering demand and water shortages in California have led almond prices to grow by more than +60% year-on-year. Increases also for pistachios (+46% since the beginning of the year) due to the drought in Iran. Supply problems also for hazelnuts, with a drop of +60% in Italy due to the frost at the beginning of the year: prices are already growing by more than +50% compared to the previous year. Cashew nuts are suffering greatly from the difficulties of sea transport: products arriving from Vietnam have undergone price increases of over +25% in a year.
  • Coffee: price increases of almost +80% since the beginning of the year, due to a sharp reduction in stocks due to the severe drought that is damaging reed beds and Arabica coffee plantations in Brazil (the leading producer and exporter), while for the Robusta variety the slowdown in exports caused by Covid in Vietnam is heavily weighing.
  • Raw sugar (world market): price increases of +30% since the beginning of the year: same causes, weather and Covid, as for coffee. Brazil, Vietnam, and India are in fact key countries for sugar as well.
  • White sugar (Europe/Italy): production difficulties have led to a decrease in sugar stocks in Europe, which will have to increase imports from international markets at higher prices. In Italy prices have gone from 460 €/tonne at the end of 2020 to current quotations even higher than 600 €/tonne.
  • Cocoa: increases of over +20% for cocoa beans between July and early October, after a year of stagnation thanks to abundant production in Africa. Heavy correction during October, with a drop of almost -10% in just two weeks.
  • Vegetable oils: labor shortages in Malaysia due to Covid, restart of demand from major importing countries, El Niño disturbances, and oil price increases have led to an increase in prices of the entire vegetable oil sector (palm, sunflower, rapeseed, coconut) with increases in the order of +50% in the period June-October 2021. Extra virgin olive oil in the EU underwent increases of +25% in 2021, while slight decreases were recorded for the extra virgin olive oil produced in Italy.
  • Legumes: the drought in Canada has affected pea and lentil production. In Saskatchewan, quotations have increased from +80% (green peas) to +50% (red lentils) since the beginning of June.
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